What's happened
Italy's government aims to raise about €4.3 billion from banks and insurers in 2026 as part of an €18 billion fiscal package. Prime Minister Meloni emphasizes that profits from 2025 will fund social support, while the government also plans to cut income taxes for certain earners. The move is part of broader efforts to support public finances amid economic uncertainty.
What's behind the headline?
Italy's fiscal strategy reflects a balancing act between raising revenue and maintaining social support. The €4.3 billion bank tax increase targets large financial institutions, which are seen as capable of contributing more during economic challenges. Prime Minister Meloni's emphasis on profits funding social programs suggests a focus on social cohesion, but the tax hike could impact banking sector profitability and investment. The broader €18 billion package indicates a proactive approach to fiscal sustainability, yet it risks straining the financial sector if not carefully managed. The tax cuts for middle earners aim to bolster purchasing power, aligning with Meloni's political base, but may complicate fiscal targets if revenue projections fall short. Overall, Italy's measures will likely influence its economic stability and social cohesion in the coming months.
What the papers say
Bloomberg reports that Italy plans to raise €4.3 billion from banks and insurers in 2026 as part of an €18 billion fiscal package, with Prime Minister Meloni emphasizing profits from 2025 will fund social programs. Bloomberg also notes that UniCredit CEO Andrea Orcel believes the bank can mitigate the impact of the tax increase. Politico highlights the €18 billion package aimed at supporting households and businesses amid economic uncertainty. Bloomberg further details the tax cuts for incomes between €28,001 and €50,000, part of Meloni's campaign promises. The contrasting perspectives show Bloomberg's focus on fiscal measures and sector impact, while Politico emphasizes social and economic support, illustrating the multifaceted approach of Italy's government.
How we got here
Italy's government has been implementing fiscal measures to support economic stability and social welfare. The €18 billion package, announced in October 2025, includes tax increases on banks and insurers to raise revenue, alongside tax cuts for certain income brackets. These measures aim to balance public finances with social support amid ongoing economic uncertainty.
Go deeper
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Italy, officially the Italian Republic, is a sovereign country consisting of a peninsula delimited by the Alps and surrounded by several islands. Italy is located in south-central Europe, and is considered part of western Europe.
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Giorgia Meloni (Italian: [ˈdʒordʒa meˈloːni]; born 15 January 1977) is an Italian politician who has served as Prime Minister of Italy since October 2022. She is the first woman to hold the office and the head of the third-longest Government in the h
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Giancarlo Giorgetti is an Italian politician and prominent member of Lega Nord, of which he became deputy secretary in 2013. He was secretary of the Council of Ministers in the Conte I Cabinet.
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Andrea Orcel is Group CEO of UniCredit. He previously served as the president of UBS Investment Bank from November 2014 to September 2018.